Taoiseach Micheál Martin under fire over housing policy

Taoiseach Micheál Martin has been criticised for saying that more private investment is needed to address the housing crisis.

Fianna Fáil and Fine Gael have come under pressure on housing after claiming that around 40,000 new homes would be built in 2024, when the final figure was 30,330.

Mr Martin said more private investment is needed to boost rental supply as the state is already investing “huge” amounts to subsidise the sector.

Opposition politicians have criticised his comments as “doubling down on the disastrous policies” the parties had adopted to date.

Average rents nationally increased by more than 85% in the 12 years to 2022, the third highest increase in the EU.

In the 12 months to May last year, rents increased by 5.9% for existing tenancies and 9.1% for new renters.

A 2% cap on rent increases per year in rent pressure zones (RPZs), was introduced in 2016 to attempt to dampen spiralling rent costs.

Expire 

These regulations are due to expire on December 31 this year. It has been argued that RPZs are somewhat ineffective as there is evidence the 2% cap is not being complied with.

In an interview with the Irish Examiner published on Saturday, Taoiseach Micheál Martin said that the Government will review all housing policies in order to try and boost housing supply, including whether to abolish RPZs at the end of the year.

The Housing Commission report recommended that RPZs should be replaced with a “rent reference” system, which Mr Martin said that the coalition would consider.

Mr Martin also said there were “huge subsidies from the State” in the housing sector already, and that Ireland needs the private sector “involved in apartment building, in greater rental supply”. He said pension funds “have a role in of financing construction” in Ireland and should not have become the subject “of total negativity”.

Speaking on RTÉ’s This Week on Sunday, Mr Martin doubled down on his comments.

“It’s clear to me from the discussions I’ve had with various Government departments and officials in respect of the housing question, that we need to pivot more strongly to getting private sector investment into the market,” Mr Martin said.

“The Government is spending huge amounts of money on housing, record levels, the state can’t do it all on its own, and we have to be honest about that, not just this government but the Oireachtas more generally.”

Decisions 

Asked if taking difficult decisions on housing included abolishing RPZs, he said: “I believe it will entail very difficult political decisions.” Asked if RPZs are a problem, Mr Martin said he has been told the “reactionary” approach to the rental market and the uncertainty in the sector is a “huge” problem.

Opposition politicians have criticised the Taoiseach’s comments, and called for a ban on rent increases.

Sinn Féin’s housing spokesperson Eoin Ó Broin said a three-year ban on rent increases and a full month’s rent returned to every private renter was needed.

Scrapped

He said institutional investors have in recent weeks lobbied to have RPZs “scrapped”, and if they were successful it would lead to “even more dramatic increases in rents”.

People Before Profit TD Richard Boyd Barrett said he was “aghast” at Mr Martin’s comments, and argued a state construction company was needed.

“It’s clear that Micheál Martin and the Government are doubling down on the disastrous policies that have got us to where we are,” he said.

The Irish Property Owners Association (IPOA) welcomed Mr Martin’s comments, claiming that the regulations had “contributed to inefficiencies that adversely impact the supply of rental housing and the ability of landlords to operate in the rental market”.